We all love to buy our favourite gadgets and products without having to worry about how much money we have in our pocket right now!
Credit cards let people do just that. You can buy your parents an air conditioner or book a surprise holiday with your spouse, without waiting for the salary, by using a credit card for such payments.
Cardholders can get these bulky payments converted into easily repayable monthly instalments on their credit cards.
With the variety of credit card variants banks and financial institutions offer to their customers, a credit card comparison is necessary to select the best credit card.
3 Tips Before You Choose a Credit Card
Credit cards are loaded with features and benefits ranging from cash-backs to redeemable reward points on credit card spending.
However, there are charges and interest cardholders may have to pay for using the card.
Therefore, it is beneficial to understand a few tips for choosing a credit card.
Tip 1: Select the type of credit card you want: Since the customer is spoiled with choices when it comes to credit card variants, selecting the right credit card is crucial. For example, an individual who travels frequently can select a travel reward credit card while someone who plans to use the card for business can select a business credit card.
A customer may need a credit card for the following different reasons:
- Often people get a credit card to build a healthy credit score. An individual who has a low credit score or a bad credit history can take a credit card and make the bill payments in a disciplined way to build a healthy credit score. Secured credit cards and student credit cards are best suitable for this purpose.
- People who use their credit cards for frequent purchases can opt for a cash-back or reward credit card as this will give them higher discounts and offers on their purchases.
- If someone plans to use the credit to make an expensive purchase that would take time to repay, he can choose a 0% intro APR credit card to avoid paying interest on his balance payments.
Tip 2: Select the features you want in your credit card: The next step is to select the credit card features that matter. Here are the features of a few prominent credit card variants:
- Credit cards for improving credit score: A customer who wants to improve his credit score with the help of his credit card can select a card that does not charge an annual fee. It would save him from unwanted extra costs. He can also pick a card issuer that sends free monthly credit score reports to its customers.
- Credit cards for rewards: Some credit cards offer flat discounts or reward rates on all expenses while others offer different benefits for different kinds of expenditures. Customers looking for rewards may also prefer a credit card offering a joining bonus. If someone makes frequent trips abroad, he can opt for a credit card that charges no foreign transaction fees.
- 0% intro APR cards: If an individual is choosing a 0% intro APR card, he should look for a card offering 0% APR for a long period. The period should be enough to give him time to pay off his debt. Along with 0% intro APR, customers can look for additional features like reward points on these credit cards.
Tip 3: Compare the credit card options: Now that the customer is aware of the features he wants in his credit card and has selected the type of credit card he wants, he can look through the offers different card issuers give for his chosen category. This will help the customer make a final decision on which credit card he wants to choose.
Parameters to Check for Comparing Credit Cards
In India, customers can check the following parameters to compare different credit cards:
- There are fuel credit cards, entertainment credit cards, travel credit cards, lifestyle credit cards, premium credit cards, and many more such categories of credit cards. A customer should analyse his spending habits and select the credit card that suits his spending the most.
- Credit card companies have merchant partners. These are brands the cardholder can shop from and get several benefits on his purchases. Choose a credit card issuer who has partnered with reputed brands and brands of your choice.
- Credit cards have a charge structure according to which the cardholder has to make the payments towards their credit cards. Customers can select a credit card with a suitable card structure like a zero joining fee, annual maintenance fee, or card upgrading fee.
Choosing the right credit card can help the cardholder manage his monthly expenses more smartly. He can also get rewards and cash-backs with the correct credit card information. Always choose a trusted bank with lenient eligibility criteria to get your credit card for a better experience.